Marketing ch.10

What is the first step in value-based pricing?

Assessing customer needs and value perceptions

What of the following describes cost-based pricing?

Based on the costs of producing, distributing, and selling the product plus a fair rate of return for effort and risk

Which of the following best defines fixed costs?

Costs that do not vary with production or sales level

__________ is based on a buyer's perceptions of value rather than on the seller's cost.

Customer value-based pricing

What is the second step in cost-based pricing?

Determining product costs

Which term refers to the drop in the average per-unit product cost that comes with accumulated production experience?

Experience curve

__________ are costs that do not vary with production or sales level.

Fixed costs

__________ is offering just the right combination of quality and good service.

Good-value pricing

__________ is the amount of money charged for a product or service, or the sum of the values that customers exchange for the benefits of having or using the product or service.

Price

What is the second step in value-based pricing?

Setting a target price to match customer perceived value

Which term refers to pricing that starts with an ideal selling price, then targets costs that will ensure that the price is met?

Target costing

What does the experience curve illustrate?

The drop in the average per-unit product cost that comes with accumulated production experience

__________ is attaching specific features and services to differentiate a company's offers.

Value-added pricing

__________ vary directly with the level of production.

Variable costs

Customer-value based pricing is __________.

based on a buyer's perceptions of value rather than on the seller's cost

The addition of a standard markup to the cost of the product is known as __________.

cost-plus pricing

In cost-based pricing, __________ is the first step.

designing a good product

The fourth step in value-based pricing is __________.

designing products to deliver the desired value at the target price

In value-based pricing, __________ is the third step.

determining the costs that can be incurred

Convincing buyers of a product's value is the __________ step in cost-based pricing.

fourth

In value-based pricing, designing products to deliver the desired value at the target price is the __________ step.

fourth

In cost-based pricing, determining product costs is the __________ step.

second

In value-based pricing, setting a target price to match customer perceived value is the __________ step.

second

Setting the price based on cost is the __________ step in cost-based pricing.

third

The __________ step in value-based pricing is determining the costs that can be incurred.

third